FCC: Broadcasters’ Initial Repack Cost Estimate Is $2.1 Billion

The FCC saidFridaythat—based on the estimates it has received on the 900-plus TV stations moving in the post-incentive auction repack—the aggregate total request for reimbursement is $2,115,328,744.33, with still some more MVPDs and a handful of stations to weigh in.

“Based on information we have received as of7 a.m.today [July 14]," said Jean Kiddoo, chair of Incentive Auction Task Force, "the aggregate amount of the estimated costs reported by reimbursement-eligible entities is $2,115,328,744.33. We expect to receive additional estimates from MVPDs and a small number of stations. In addition, the initial estimates that comprise this amount will be subject to a careful review by the Commission and our fund administrator. The aggregate cost estimate provided today will therefore change for purposes of the initial allocation of reimbursement funds.”

The estimates are what broadcasters have asked for. The FCC will vet those requests and decide according to a congressional mandate to cover reasonable repack-related expenses—what and how much to cover. There could also be some tweaks that reduce the potential moving costs some stations have initially submitted as well as additional asks from the stations and MVPDs yet to weigh in.

“Congress's passage of the voluntary broadcast TV incentive auction legislation was premised on a promise that no TV station would be punished for not participating in the auction," said National Association of Broadcasters President Gordon Smith. "Today's release of total estimated costs for the ‘TV repack’ shows a shortfall of over $365 million in available repacking funds, with a number of television stations and MVPDs not yet included in the total. That number could grow as stations amend cost estimates due to changed circumstances."

“I understand the broadcast and MVPD industry cost data is mostly submitted," said Commissioner Michael O'Rielly. "While Commission staff will need some time to analyze the particular submissions, if it turns out that legitimate expenses exceed the statutory limit, which is not unreasonable to assume at this time, I have always said that I would be the first to make the case to Congress for additional funds. No broadcaster or MVPD, nor their viewers or listeners, should be harmed by the repack process."

“This was a foreseeable issue that Democrats have been warning about since last year, and I plan to introduce the Viewer Protection Act next week in order to fix the problem," said House Energy & Commerce Committee ranking member Frank Pallone (D-N.J.). "My bill – which was released last Congress – will provide additional funding for the incentive auction repacking reimbursements so that no consumer will be without the essential local broadcast stations that they rely on. I hope that the Republicans will quickly take up this legislation to resolve this issue.”

While broadcasters would clearly benefit from the extra funds, Pallone has said the focus of his bill is on making sure that viewers would not be shortchanged.